So what: PetMed is nicely profitable, trades at a pretty reasonable valuation, and even pays a decent dividend. But the company's growth has slowed dramatically in recent years -- from a 17% revenue gain in its 2009 fiscal year (which ends in March), to less than 9% in 2010, and all the way down to 1.4% over the past 12 months. Wall Street firm Piper Jaffray doesn't think the trend is about to change. The firm put out a research note reiterating an "underweight" rating on PetMed shares, saying that competition is continuing to put pressure on both volumes and pricing.

Now what: What does this note mean for PetMed s hareholders? It shouldn't mean blindly dropping the stock from your portfolio. Not only do Wall Street analysts get it wrong sometimes, but differences in investment timeframes and expected returns can make an investment attractive to one investor while it's less attractive to another. However, based on PetMed's record over the past few years, the concern about competitive pressures shouldn't be dismissed, so the warning from Piper could be a good reason to dig back in to make sure the stock is still an attractive investment.

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Management seems to be stuck in a time warp. The whole 1-800-PETMEDS thing might have been cutting-edge trendy in the 1990s, but today it creates a tacky, late-night-cable-TV vibe -- and the web site itself is cluttered, dated, and unattractive. Great if you're peddling toys to pre-teens, maybe, but if you're selling prescription medications to people who take their pets' health seriously, not so much.

If you arrive there from a Google search (they do get kudos for being top of the page), I think you're as likely to move on as to place an order.

In my opinion, PETS needs an overhaul, and a more modern and professional image.